Denis O Brien gets snout in IBRC Trough


#1

Siteserv which owes €150m to Anglo is for sale …to Denis O Brien for €45m and a debt writedown of the rest of the money. So the taxpayer gets around €40m coz the shareholders or directors will cream off €5m for themselves first.

irishtimes.com/newspaper/fro … 33936.html

**It is NOT for sale to Altrad of France for €60m . ** which should increase the taxpayers take by 37.5% to €55m

IBRC do not appear to have any view on what is best for the taxpayer in this case. Why??

irishtimes.com/newspaper/fin … 71785.html


#2

Does not compute. At fucking all.


#3

Very interesting
Their accounts to April 2011 are here siteserv.ie/investors.html

Operating Profit 8,261k
Interest Costs (8,130k)
Profit before tax 131k
Interest bearing loans 147,764k

So a company that is trading profitably, paying all its interest on its debt pile, manages to strong arm its bankers into a HUGE debt write down?

There were trade creditors and other payables of 77,980 THEN. Must be nearer 100 million now. And they get paid in full? And the bank takes the write down.

Another win for Anglo.
Could do with a parliamentary question I think.


#4

You just pay your household charge and don’t be worrying yourself about extremely complex issues like this…


#5

Manages to strong arm its bankers into a huge debt write down AND a 5 million payout for the principals…


#6

irishtimes.com/newspaper/bre … king8.html

Of course they’d approve it.

Can anyone outline the probable thought process of those within Anglo who approved this?

Writing off about 100million loan for a company which is performing and saleable seems like poor banking sense to me but I know nothing about this.


#7

Nice to see the directors increased their pay in 2011 over 2010 by 100k in total, with 5 execs and one non-exec getting 1.2M between them. And also nice to see the chief exec Brian Harvey will be getting 16% of the 5M allocated to shareholders. Nice all round. Thursday nice.


#8

Very obvious sweetheart deal for incumbent mgt. Altrad would have paid more but then how would mgt get rich after buggering up the balance sheet ?

Dukes and Aynsley deserve a grilling for this one


#9

Off the top of my head:
We can’t put this in receivership because it will destroy “enterprise value”
We can’t put this in receivership because it will lead to termination of contracts and thus destroy “enterprise value”
We can’t decapitate existing management because its vital to sew them up in a non-compete clause or they’ll set up again and take all the contacts with them.

Its a huge call. And an Aynsely call. He can’t hide behind an underling on this. If he isn’t hired to make the right call on this sort of stuff, then what the f**k is he for?

What I really want to know is did anyone leak out what the banks internal provisioning against this loan was? :nin
Because the way Irish bankers think is so small minded as long as they’re “fully provided” they don’t mind a big loss, but even if a situation is terrible they won’t realise a loss until they’ve “got their provisions right”


#10

Aynsley is not fully provided, the TAXPAYER is. :frowning:

Any chance we can send this to the IMF for a look see ??


#11

Pearse Doherty is the man for this. Or Shane Ross if you’re that way inclined.


#12

I wonder would KPMG and Davy be on the hook here. Their sales exercise and valuation etc is called into question by this.


#13

This is where moral hazard kicks in.
Every highly leveraged company which has been bank-rolled by Anglo are now going to be looking at the state of play.
Why would you pay off your debt when you can just get it forgiven.
Issue more shares, dilute your ownership to clear you debts? Nah.
cut directors salaries and fire current directors who got the company in over it’s head? Nah.
Lets just bluff our bank and get our debt forgiven.

…and we have the f*cker O’Brien right in the thick of it all too.

More time has been spent on this site discussing debt-forgiveness for mortgagees than on this corporate debt forgiveness. How many mortgages would you have to forgive to get to these sorts of euro numbers? 5000 houses? 8000 houses?

Shane Ross, Pearse Doherty. All they are good for is for pointing out how the Irish have been swindled once again. They cry out after the horse has bolted. they have no more power to prevent anything than the man in the street. There is something fundamentally wrong with the way official Ireland works and I don’t see it ever being fixed.


#14

The EBITDA is 15M, O’Briens offer was 3. Thats kind of low on the current 4 to 6 times view. There was always going to be a huge writedown by anglo which at 107m almost exactly matches the goodwill of 100m. Say four times (the alternative offer) and the equity gets wiped (and yes Blamegame is right about the effect of a receivership on a business but people have learned since the Kieran Wallace Superquinn fiasco), and Anglo get 20M more. So 5 to 20M is what Anglo gave away here. Not a lot in the Anglo book, but look after the millions and the billions will take care of themselves.


#15

Yes exactly. As dipole said its open season. It turns out ‘Delay and Pray’ and ‘Extend and Pretend’ since around 2005 (or whenever this company started its spending spree) has really just been, wait around, procrastinate, let interest accumulate and then burn capital. Instead of burning bondholders, Anglo burns its capital base. Probably the write down on this loan was hidden in the 31 billion write-down on their book, but we’ll never know, because they’ll never break that number down for us.

What exactly are we paying The Jolly Swagman 500k + living expenses for?


#16

This stinks!

independent.ie/business/iris … 73345.html
Altrad representative had to buy shares to speak at the EGM to complain that their higher bid hadn’t been entertained and that the Irish people were owed a debt.


#17

So maybe giving away 5-20m here helps them recover a rumoured much larger sum from D’OB.


#18

Sindo had a full page on this- they are digging a lot re DOB recently

There was a question at the shareholder meeting reported in the sindo that the chairman wouldn’t comment on, namely the personal borrowings of the CEO to Anglo, presumably to buy shares in Sitesev and exercise options.

Is it possible that Anglos loss here is even bigger than what they are pretending ?

How much did Harvey own and what price did he obtain those shares at ? Is this sort of thing on the Bloomberg history for the company ?

Also the Dix chap is a KPMG partner and a director of Siteserv and was defending the KPMG and Davy sales process. Was he appointed by Siteserv or Anglo ? Who is the director appointed by Anglo who didn’t attend the shareholder meeting, what’s his background is he an Anglo employee or just their nominee ?


#19

Interesting prediction in the Independent yesterday - that Siteserv will be nicely positioned to get the contract for installation/operation of water meters nationwide:
independent.ie/opinion/analy … 74214.html

Thoughts?


#20

bloomberg.com/news/2013-01-2 … meets.html

Crony capitalist meets new cronies. Strong stomach needed to read full article.